Step 1 Mission Statement Figure 2. This is perhaps the most difficult aspect of marketing planning for managers to master, because it is largely philosophical and qualitative in nature. Here, we can see two levels of mission. One is a corporate mission statement; the other is a lower level, or purpose statement. It is appropriate at the strate- gic business unit, departmental or product group level of the organization The following is an example of a meaningless, vapid, motherhood-type mission statement, which most companies seem to have.
They achieve nothing and it is difficult to understand why these point- less statements are so popular. Employees mock them and they rarely say anything likely to give direc- tion to the organization. The following should appear in a mission or purpose statement, which should normally run to no more than one page: 1.
Business definition — define the business, preferably in terms of the benefits you provide or the needs you satisfy, rather than in terms of what you make. Competence can consist of one particular item or the possession of a number of skills compared with competitors. Step 2 Setting Corporate Objectives What corporate objectives are, and where they fit in the total process, was discussed in the previous section.
Step 3 The Marketing Audit Any plan will only be as good as the information on which it is based, and the marketing audit is the means by which information for planning is organized. Given the growing turbulence of the business environment and the shorter product lifecycles that have resulted, no one would deny the need to stop at least once a year at a particular point in the planning cycle to try to form a reasoned view of how all the many external and internal factors have influenced performance.
Sometimes, of course, a company will conduct a marketing audit because it is in financial trouble. At times like these, management often attempts to treat the wrong symptoms, most frequently by reorganizing the company. But such measures are unlikely to be effective if there are more fundamental problems which have not been identified.
Of course, if the company survived for long enough, it might eventually solve its problems through a process of elimination. Essentially, though, the argument is that the problems have first to be properly defined. The audit is a means of helping to define them. Two kinds of variable Any company carrying out an audit will be faced with two kinds of variable.
First, there is the kind over which the company has no direct control, for example economic and market factors. This division suggests that the best way to structure an audit is in two parts, external and internal.
However, many highly successful companies, as well as using normal information and control procedures and marketing research throughout the year, start their planning cycle each year with a formal, audit-type process, of everything that has had an important influence on marketing activities.
Certainly, in many leading consumer goods companies, the annual self-audit approach is a tried and tested discipline. Objections to line managers doing their own audits usually centre on the problem of time and objectivity. In practice, a disciplined approach and thorough training will help.
But the discipline must be applied from the highest to the lowest levels of management if the tunnel vision that often results from a lack of critical appraisal is to be avoided. Where relevant, the marketing audit should contain lifecycles for major products and for market segments, for which the future shape will be predicted using the audit information.
Also, major products and markets should be plotted on some kind of matrix to show their current competitive position. The next question is: what happens to the results of the audit? Some companies consume valuable resources carrying out audits that produce very little in the way of results. The audit is simply a database, and the task remains of turning it into intelligence, that is, information essential to decision making. Accordingly, a pension is a product, not a market, as many other products can satisfy the same or similar needs.
In the sense that if five million radiators are made or imported, five million radiators must be distributed, five million radiators must be installed and the decision about which radiators are to be installed must be made by someone. It is the purpose of the market map to spell all this out quantitatively. It is at key decision points that market segmentation should take place. A segment is a group of customers or consumers that share the same or approximately the same needs; this is discussed in detail in Chapter 4.
This step is crucial, for it is upon the key segments from the market map that SWOT analyses should be completed. Some companies consume valuable resources carrying out audits that bring very little by way of actionable results.
The Marketing Planning Process: 1 The Main Steps 45 Indeed, there is always the danger that, at the audit stage, insufficient attention is paid to the need to concentrate on analysis that determines which trends and developments will actually affect the company. Thus, inclusion of research reports, or overde- tailed sales performance histories by product which lead to no logical actions whatever, only serve to rob the audit of focus and reduce its relevance.
One useful way of doing this is in the form of a number of SWOT analyses. A SWOT is a summary of the audit under the headings, internal strengths and weaknesses as they relate to external opportunities and threats.
These SWOT analyses should, if possible, contain just a few paragraphs of commentary focusing on key factors only. A summary of reasons for good or bad performance should be included. They should be interesting to read, contain concise statements, include only relevant and important data, and give greater emphasis to creative analysis. Step 6 Assumptions Let us now return to the preparation of the marketing plan. If we refer again to the marketing planning process, and have completed our marketing audit and SWOT analyses, assumptions now have to be written.
There are certain key determinants of the marketing plan. If we refer again to the marketing planning process, and have completed our marketing audit and SWOT analyses, assump- tions now have to be written. It is really a question of standardizing the planning environment. For example, it would be no good receiving plans from two product managers, one of whom believed the market was going to increase by 10 per cent, while the other believed the market was going to decline by 10 per cent.
Industrial overcapacity will increase from per cent to per cent as new industrial plants come into operation.
Price competition will force price levels down by 10 per cent across the board. A new product in the field of x will be introduced by our major competitor before the end of the second quarter. Step 7 Marketing Objectives and Strategies The next step in marketing planning is the writing of marketing objectives and strategies, the key to the whole process.
An objective is what you want to achieve. A strategy is how you plan to achieve your objectives. Thus, there can be objectives and strategies at all levels in marketing. For example, there can be advertising objectives and strategies, and pricing objectives and strategies.
However, the important point to remember about marketing objectives is that they are about products and markets only. Thus, pricing objec- tives, sales promotion objectives, advertising objectives and the like should not be confused with marketing objectives. They should be capable of measurement, otherwise they are not objectives. Measurement should be in terms of some, or all, of the following: sales volume; sales value; market share; profit; percentage penetration of outlets for example, to have 30 per cent of all retail outlets stocking our product by year 3.
Marketing strategies are the means by which marketing objectives will be achieved and generally are concerned with the four Ps, as follows: Product — The general policies for product deletions, modifications, addition, design, brand- ing, positioning, packaging, etc.
Price — The general pricing policies to be followed by product groups in market segments Place — The general policies for channels and customer service levels Promotion — The general policies for communicating with customers under the relevant head- ings, such as advertising, sales force, sales promotion, public relations, exhibitions, direct mail, etc.
It is also normally at this stage that alternative plans and mixes are considered, if necessary. Step 9 The Budget In a strategic marketing plan, these strategies would normally be costed out approximately and, if not practicable, alternative strategies would be proposed and costed out until a satisfactory solution could be reached. This would then become the budget. In most cases, there would be a budget for the full three years of the strategic marketing plan, but there would also be a very detailed budget for the first year of the plan which would be included in the one-year operational plan.
It will be obvious from all of this that the setting of budgets becomes not only much easier, but the resulting budgets are more likely to be realistic and related to what the whole company wants to achieve, rather than just one functional department. The most satisfactory approach would be for a marketing director to justify all marketing expend- iture from a zero base each year against the tasks he or she wishes to accomplish.
A little thought will confirm that this is exactly the approach recommended in this chapter. If these procedures are followed, a hierarchy of objectives is built up in such a way that every item of budgeted expenditure can be related directly back to the initial corporate financial objectives.
For example, if sales promotion is a major means of achieving an objective in a particular market, when sales promotional items appear in the programme, each one has a specific purpose which can be related back to a major objective. The incremental marketing expense can be considered to be all costs that are incurred after the product leaves the factory, other than costs involved in physical distribution, the costs of which usually represent a discrete subset.
There is, of course, no textbook answer to problems relating to questions such as whether packaging should be a marketing or a production expense, and whether some distribution costs could be considered to be marketing costs.
For example, insistence on high service levels results in high inventory carrying costs. Only common sense will reveal workable solutions to issues such as these.
Under price, however, any form of discounting that reduces the expected gross income, such as promotional discounts, quantity discounts, royalty rebates, and so on, as well as sales com- mission and unpaid invoices, should be given the most careful attention as incremental marketing expenses. The healthiest way of treating these issues is a zero-bases budgeting approach.
Step 10 First Year Detailed Implementation Programme In a one-year tactical plan, the general marketing strategies would be developed into specific subob- jectives, each supported by more detailed strategy and action statements. A company organized according to functions might have an advertising plan, a sales promotion plan, a pricing plan, and so on.
A product-based company might have a product plan, with objectives, strategies and tactics for price, place and promotion as necessary. A market or geographically based company might have a market plan, with objectives, strategies and tactics for the four Ps as necessary. Likewise, a company with a few major customers might have customer plans.
Any combination of the above might be suitable, depending on circumstances. A written marketing plan is the backdrop against which operational decisions are taken. Consequently, too much detail should be avoided.
Its major function is to determine where the company is, where it wants to go and how it can get there. What should actually appear in a written strategic marketing plan is shown in Table 2.
This strategic marketing plan should be distributed only to those who need it, but it can only be an aid to effective management. It cannot be a substitute for it. Start with a mission statement. Here, include a financial summary which illustrates graphically revenue and profit for the full planning period.
Now do a market overview: Has the market declined or grown? How does it break down into segments? What is your share of each? Keep it simple. If you do not have the facts, make estimates. Use lifecycles, bar charts and pie charts to make it all crystal clear. Now identify the key segments and do a SWOT analysis for each one: Outline the major external influences and their impact on each segment.
List the key factors for success. These should be less than five. Score yourself and your competi- tors out of 10 and then multiply each score by a weighting factor for each critical success factor e. Make a brief statement about the key issues that have to be addressed in the planning period. Summarize the SWOTs using a portfolio matrix in order to illustrate the important relation- ships between your key products and markets. List your assumptions. Set objectives and strategies.
Summarize your resource requirements for the planning period in the form of a budget. We have just described the strategic marketing plan and what it should contain. The tactical marketing plan layout and content should be similar, but the detail is much greater, as it is for one year only.
Is it different in a diversified and an undiversified company? Yet these rarely bring any benefits and often bring marketing plan- ning itself into disrepute. It is also clear that unless a company rec- ognizes these implications, and plans to seek ways of coping with them, formalized strategic planning will be ineffective.
Research8 has shown that the implications are principally as follows: 1. Any closed-loop planning system but especially one that is essentially a forecasting and budget- ing system will lead to dull and ineffective marketing.
Therefore, there has to be some mechanism for preventing inertia from setting in through the over-bureaucratization of the system. Planning undertaken at the functional level of marketing, in the absence of a means of integra- tion with other functional areas of the business at general management level, will be largely ineffective. The separation of responsibility for operational and strategic planning will lead to a divergence of the short-term thrust of a business at the operational level from the long-term objectives of the enterprise as a whole.
This will encourage preoccupation with short-term results at operational level, which normally makes the firm less effective in the longer term.
Unless the chief executive understands and takes an active role in strategic marketing planning, it will never be an effective system. A period of up to three years is necessary especially in large firms for the successful introduction of an effective strategic marketing planning system.
Let us be dogmatic about requisite planning levels. First, tomer considered by the supply- in a large diversified group, irrespective of such organizational ing company to be of strategic issues, anything other than a systematic approach approximat- importance to the achievement ing to a formalized marketing planning system is unlikely to of its own objectives.
Hence, enable the necessary control to be exercised over the corporate such a customer is singled out identity. Second, unnecessary planning, or overplanning, could for special treatment easily result from an inadequate or indiscriminate consideration of the real planning needs at the different levels in the hierarchi- cal chain.
This process and its relationship to the other issues discussed in this chapter are summarized in Figure 2. Weak support from the chief executive and top management. Lack of a plan for planning. Confusion over planning terms. Numbers in lieu of written objectives and strategies. Too much detail, too far ahead. Once-a-year ritual. Separation of operational planning from strategic planning. Failure to integrate marketing planning into total corporate planning system.
Delegation of planning to a planner. This time, however, a time element is added, and the relationship between strategic planning briefing, long-term strategic plans and short-term operational plans is clarified. If this is not clear, let us give an example of a supplies company servicing the needs of a national health service shown in Figure 2.
Each of these hospital groups may well have their own key account manager who has to plan for them. Indeed, in any- thing other than small organizations, it is clearly absurd to think that any kind of meaningful planning can take place without the committed inputs of those who operate where the customers are. Every principle outlined in this chapter applies right down to the individual key account.
Thus, the plan- ning process shown in Figure 2. This book, however, does not deal specifically with key account planning, which is dealt with in detail in another book by one of the authors. List the good things and the bad things about it.
Say how you think it could be improved. Marketing planning is a logical sequence of events leading to the setting of marketing objectives and the formulation of plans for achieving them. The sequence is: 1. Mission statement 2. Set corporate objectives 3. Conduct marketing audit 4. Conduct SWOT analyses 5. Make assumptions 6.
Set marketing objectives and strategies 7. Estimate expected results 8. Identify alternative plans and mixes 9. Set the budget Establish first year implementation programmes. Financial summary 3. Market overview 4. SWOT analyses 5. Portfolio summary 6. Marketing objectives and strategies 8. Forecasts and budgets. As business becomes increasingly complex and competition increases, a marketing plan is essential. The benefits are as follows: 1. It allows better coordination of activities. It identifies expected developments.
It increases organizational preparedness to change. It minimizes non-rational responses to the unexpected. It reduces conflicts about where the company should be going. It improves communications. Management is forced to think ahead systematically. Available resources can be better matched to opportunities. The plan provides a framework for the continuing review of operations. A systematic approach to strategy formulation leads to a higher return on investment. All companies need to have a longer-term strategic marketing view as well as a short- term tactical marketing operation.
Often the most potent short-term tactic is the use of the sales force. These can combine thus: Market planning Poor Excellent Die Good Thrive quickly Sales performance Die Poor Survive slowly From this it can be seen that being good at implementing the wrong strategy can lead to a very quick death!
Q: Are we talking about tactics or strategy? A: A strategic marketing plan takes a long-term look say three years and is therefore strategic. A tactical, or operational, marketing plan is a detailed scheduling and costing out of the first year of the strategic marketing plan. Q: How is the marketing plan used? A: The plan determines where the company is now, where it wants to go and how to get there.
It therefore should be the backdrop against which all organizational decisions are made. Q: Does the plan have to be written? A: The planning sequence is really a thinking process. However, key pieces of information are worth writing down because they reduce confusion and aid communication. The degree of formality depends on the size of the company and the complexity of its business. Q: How detailed should it be? A: Enough to be useful. If you choose, you can then take matters further by working out in what ways the planning process might be improved.
The third exercise explores the extent to which your company is receiving the benefits that are usually attributed to a marketing planning process. There are several benefits to be derived from knowing this: 1. It can be a powerful means of communicating to your colleagues that all might not be well in the company. It provides an unambiguous message about what the company needs to address for future survival.
Exercise 2. This approach will also enable you to identify information gaps that might be unknown to you at present. Although care has been taken to use generally accepted terminology in the wording of this questionnaire, there will always be the company that uses different words.
For exam- ple, when we talk about return on investment ROI , other companies might well use other expressions or measures, such as return on capital employed, etc. With this caveat in mind, please respond to the questionnaire by putting a tick against each question in one of the four columns provided. Is there a target figure for ROI? Is there a corporate plan to channel the com- pany resources to this end?
Are there defined business boundaries in terms of: a Products or services that will be offered? Are there objectives for promoting the corporate image with: a The stock market? Section 2 Strategic issues 1. Is there a marketing plan? Is it compatible with the corporate plan? Does it cover the same period? Is the marketing plan regularly reviewed? Is the plan based on an assessment of market potential and past performance? Do relevant managers have a copy of the mar- keting plan?
Does this person s have access to the neces- sary information? Is this person s sufficiently senior for his or her analysis to make an impact?
Is the organizational climate such that a full and accurate analysis is seen as a striving for improvement rather than an attack on specific departments or vested interests? Section 4 Assumptions 1. Is there a set of assumptions around which the marketing plan is formulated? Are these assumptions made explicit to senior company personnel? Do they cover: a The business environment? Are the assumptions valid in the light of current and predicted trading situations?
Are the marketing objectives clearly stated and consistent with the corporate objectives? Are there clear strategies for achieving the stated marketing objectives?
Are sufficient resources made available? Are all responsibilities and authority clearly made known? Are there agreed objectives about: a The product range? Is the planning system well conceived and effective? Do control mechanisms exist to ensure planned objectives are met?
Do internal communications function effectively? Are there any problems between marketing and other corporate functions? Are people clear about their role in the planning process? Is there a procedure for dealing with non- achievement of objectives? Is there evidence that this reduces the chance of subsequent failure? Are there still unexploited opportunities? Are there still organizational weaknesses? Are the assumptions upon which the plan was based valid?
Scoring and interpretation for Exercise 2. It is our experience that if there are more than eight ticks, then some aspects of planning that are cov- ered by most companies are being avoided.
Try getting a second opinion by checking your findings with colleagues. Make a note, in the space on page 60, or on a separate sheet of paper, of ways in which you think the planning process in your company could be improved. Business definition: this should be defined in terms of the benefits you provide or the needs you satisfy, rather than in terms of what you do or what you make.
Note: These factors should not apply equally to a competitor, otherwise there is no distinctive quality about them. Indications for the future: what the company will do. What the company might do. What the company will never do. Questions 1. If you do not have a mission statement, try writing one, following the guidelines provided here. Try it out on your colleagues and see if they agree with you or if they can find ways to improve on what you have written.
With your company in mind, score each benefit by means of the scale given below. Our approach to marketing planning ensures that we get a high level of coordination of our various marketing activities 2. Our marketing planning process enables us to identify unexpected developments in advance 3. When we are faced with the unexpected, our market- ing planning process minimizes the risk of non-rational responses 5. Our marketing plan improves communications about market-related issues 7.
Because of our marketing planning process, management is forced to think ahead systematically 8. Having a marketing plan enables us to match our resources to opportunities in an effective way 9.
Our marketing plan provides us with a useful framework for a continuing review of progress Check your scores below. Before you tackle this exercise, it is important to remember that profitability and high market growth are nearly always correlated. In other words, the higher the market growth, the higher the profitability.
This phenomenon can sometimes obscure the fact that a company that appears to be doing well can still be losing ground in comparison with its competitors.
While appar- ently thriving, it is in fact dying slowly. The crunch comes when the erstwhile buoyant mar- ket growth slows down, and the other companies demonstrate quite clearly their superior performance. Anupom Sarker. A short summary of this paper. Planning bridges the gap from where we are to where we want to go. It includes the selection of objectives, policies, procedures and programmes from among alternatives.
A plan is a predetermined course of action to achieve a specified goal. It is an intellectual process characterized by thinking before doing. It is an attempt on the part of manager to anticipate the future in order to achieve better performance. Planning is the primary function of management. Definitions of Planning Different authors have given different definitions of planning from time to time.
When a manager plans, he projects a course of action for further attempting to achieve a consistent co-ordinate structure of operations aimed at the desired results. It is a process of deciding the future on the series of events to follow.
Planning is a process where a number of steps are to be taken to decide the future course of action. Managers or executives have to consider various courses of action, achieve the desired goals, go in details of the pros and cons of every course of action and then finally decide what course of action may suit them best.
Planning Contributes to the Objectives Planning contributes positively in attaining the objectives of the business enterprise. Since plans are there from the very first stage of operation, the management is able to handle every problem successfully. Plan try to set everything right. A purposeful, sound and effective planning process knows how and when to tackle a problem. This leads to success. Objectives thus are easily achieved. Planning is a Primary Function of Management Planning precedes other functions in the management process.
Certainly, setting of goals to be achieved and lines of action to be followed precedes the organization, direction, supervision and control. No doubt, planning precedes other functions of management. It is primary requisite before other managerial functions step in. It is mixed in all managerial functions but there too it gets precedence. It thus gets primary everywhere. A continuous Process Planning is a continuous process and a never ending activity of a manager in an enterprise based upon some assumptions which may or may not come true in the future.
Therefore, the manager has to go on modifying revising and adjusting plans in the light of changing circumstances. According to George R. It involves continuous collection, evaluation and selection of data, and scientific investigation and analysis of the possible alternative courses of action and the selection of the best alternative.
Planning Pervades Managerial Activities From primary of planning follows pervasiveness of planning. It is the function of every managerial personnel. The character, nature and scope of planning may change fro personnel to personnel but the planning as an action remains intact. According to Billy E.
Action is required, the enterprise must operate managerial planning seeks to achieve a consistent, coordinated structure of operations focused on desired trends. Without plans, action must become merely activity producing nothing but chaos. Without planning, organisation, are subject to the winds of organizational change.
Planning is one of the most important and crucial functions of management. A business organisation has to function in these uncertainties.
It can operate successfully if it is able to predict the uncertainties. Some of the uncertainties can be predicted by undertaking systematic. Some of the uncertainties can be predicted by undertaking systematic forecasting. Thus, planning helps in foreseeing uncertainties which may be caused by changes in technology, fashion and taste of people, government rules and regulations, etc. Better Utilization of Resources An important advantage of planning is that it makes effective and proper utilization of enterprise resources.
It identifies all such available resources and makes optimum use of these resources. Increases Organizational Effectiveness Planning ensures organizational effectiveness. Effectiveness ensures that the organisation is in a position to achieve its objective due to increased efficiency of the organisation. Reduces the Cost of Performance Planning assists in reducing the cost of performance. It includes the selection of only one course of action amongst the different courses of action that would yield the best results at minimum cost.
It removes hesitancy, avoids crises and chaos, eliminates false steps and protects against improper deviations. Concentration on Objectives It is a basic characteristic of planning that it is related to the organizational objectives. All the operations are planned to achieve the organizational objectives. Planning facilitates the achievement of objectives by focusing attention on them.
Helps in Co-ordination Good plans unify the interdepartmental activity and clearly lay down the area of freedom in the development of various sub-plans. Various departments work in accordance with the overall plans of the organisation. Thus, there is harmony in the organisation, and duplication of efforts and conflict of jurisdiction are avoided.
Makes Control Effective Planning and control are inseparable in the sense that unplanned action cannot be controlled because control involves keeping activities on the predetermined course by rectifying deviations from plans. Planning helps control by furnishing standards of performance. Encouragement to Innovation Planning helps innovative and creative thinking among the managers because many new ideas come to the mind of a manager when he is planning.
It creates a forward-looking attitude among the managers. Increase in Competitive Strength Effective planning gives a competitive edge to the enterprise over other enterprises that do not have planning or have ineffective planning.
This is because planning may involve expansion of capacity, changes in work methods, changes in quality, anticipation of tastes and fashions of people and technological changes etc. Delegation is Facilitated A good plan always facilitates delegation of authority in a better way to subordinates.
Planning is an intellectual exercise and a conscious determination of courses of action. Therefore, it requires courses of action. The planning process is valid for one organisation and for one plan, may not be valid for other organizations or for all types of plans, because various factors that go into planning process may differ from organisation to organisation or from plan to plan.
For example, planning process for a large organisation may not be the same for a small organisation. However, the major steps involved in the planning process of a major organisation or enterprise are as follows: Establishing objectives The first and primary step in planning process is the establishment of planning objectives or goals. Definite objectives, in fact, speak categorically about what is to be done, where to place the initial emphasis and the things to be accomplished by the network of policies, procedures, budgets and programmes, the lack of which would invariably result in either faulty or ineffective planning.
It needs mentioning in this connection that objectives must be understandable and rational to make planning effective. Because the major objective, in all enterprise, needs be translated into derivative objective, accomplishment of enterprise objective needs a concrete endeavor of all the departments.
Establishment of Planning Premises Planning premises are assumptions about the future understanding of the expected situations. These are the conditions under which planning activities are to be undertaken.
These premises may be internal or external. Internal premises are internal variables that affect the planning. These include organizational polices, various resources and the ability of the organisation to withstand the environmental pressure.
Both internal factors should be considered in formulating plans. At the top level mainly external premises are considered. As one moves downward, internal premises gain importance. Determining Alternative Courses The next logical step in planning is to determine and evaluate alternative courses of action.
It may be mentioned that there can hardly be any occasion when there are no alternatives. And it is most likely that alternatives properly assessed may prove worthy and meaningful.
As a matter of fact, it is imperative that alternative courses of action must be developed before deciding upon the exact plan. Evaluation of Alternatives Having sought out the available alternatives along with their strong and weak points, planners are required to evaluate the alternatives giving due weight-age to various factors involved, for one alternative may appear to be most profitable involving heavy cash outlay whereas the other less profitable but involve least risk.
Evidently, evaluation of alternative is a must to arrive at a decision. Otherwise, it would be difficult to choose the best course of action in the perspective of company needs and resources as well as objectives laid down. In fact, it is the point of decision-making-deciding upon the plan to be adopted for accomplishing the enterprise objectives. Formulating Derivative Plans To make any planning process complete the final step is to formulate derivative plans to give effect to and support the basic plan.
For example, if Indian Airlines decide to run Jumbo Jets between Delhi an Patna, obliviously, a number of derivative plans have to be framed to support the decision, e. In other words, plans do not accomplish themselves. They require to be broken down into supporting plans.
Each manager and department of the organisation is to contribute to the accomplishment of the master plan on the basis of the derivative plans. Establishing Sequence of Activities Timing an sequence of activities are determined after formulating basic and derivative plans, so that plans may be put into action. Timing is an essential consideration in planning. It gives practical shape and concrete form to the programmes. The starting and finishing times are fixed for each piece of work, so as to indicate when the within what time that work is to be commenced and completed.
Bad timing of programmes results in their failure. To maintain a symmetry of performance and a smooth flow of work, the sequence of operation shaped be arranged carefully by giving priorities to some work in preference to others.
Under sequence it should be decided as to who will don what and at what time. It is also required to see whether the plan is working well in the present situation. If conditions have changed, the plan current plan has become outdated or inoperative it should be replaced by another plan.
A regular follow- up is necessary and desirable from effective implementation and accomplishment of tasks assigned. The plan should be communicated to all persons concerned in the organisation. Its objectives and course of action must be clearly defined leaving no ambiguity in the minds of those who are responsible for its execution.
Planning is effective only when the persons involved work in a team spirit and all are committed to the objectives, policies, programmes, strategies envisaged in the plan. Planning means looking ahead and chalking out future courses of action to be followed. It is a preparatory step.
It is a systematic activity which determines when, how and who is going to perform a specific job. Planning is a detailed programme regarding future courses of action. It is the basic management function which includes formulation of one or more detailed plans to achieve optimum balance of needs or demands with the available resources. Planning bridges the gap between where we are to, where we want to go.
Steps in Planning Function Planning function of management involves following steps:- 1. Establishment of objectives a. Planning requires a systematic approach. Planning starts with the setting of goals and objectives to be achieved. Objectives provide a rationale for undertaking various activities as well as indicate direction of efforts.
Moreover objectives focus the attention of managers on the end results to be achieved. As a matter of fact, objectives provide nucleus to the planning process. Therefore, objectives should be stated in a clear, precise and unambiguous language.
Otherwise the activities undertaken are bound to be ineffective. As far as possible, objectives should be stated in quantitative terms. For example, Number of men working, wages given, units produced, etc.
But such an objective cannot be stated in quantitative terms like performance of quality control manager, effectiveness of personnel manager.
Such goals should be specified in qualitative terms. Hence objectives should be practical, acceptable, workable and achievable. Establishment of Planning Premises a. Planning premises are the assumptions about the lively shape of events in future.
They serve as a basis of planning. Establishment of planning premises is concerned with determining where one tends to deviate from the actual plans and causes of such deviations. It is to find out what obstacles are there in the way of business during the course of operations. Establishment of planning premises is concerned to take such steps that avoids these obstacles to a great extent. Planning premises may be internal or external. Internal includes capital investment policy, management labour relations, philosophy of management, etc.
Whereas external includes socio- economic, political and economical changes. Internal premises are controllable whereas external are non- controllable. Choice of alternative course of action a. When forecast are available and premises are established, a number of alternative course of actions have to be considered. For this purpose, each and every alternative will be evaluated by weighing its pros and cons in the light of resources available and requirements of the organization.
The merits, demerits as well as the consequences of each alternative must be examined before the choice is being made. After objective and scientific evaluation, the best alternative is chosen. The planners should take help of various quantitative techniques to judge the stability of an alternative. Formulation of derivative plans a. Derivative plans are the sub plans or secondary plans which help in the achievement of main plan. Secondary plans will flow from the basic plan. These are meant to support and expediate the achievement of basic plans.
These detail plans include policies, procedures, rules, programmes, budgets, schedules, etc. For example, if profit maximization is the main aim of the enterprise, derivative plans will include sales maximization, production maximization, and cost minimization.
Derivative plans indicate time schedule and sequence of accomplishing various tasks. Securing Co-operation a. After the plans have been determined, it is necessary rather advisable to take subordinates or those who have to implement these plans into confidence.
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